U.S. Department of Justice Obtains Nine Indictments Against 41 Individuals for Roles in Distributing 23 Million Opioid-Medication Pills

On August 28, the U.S. Department of Justice announced that it had obtained nine indictments charging a total of 41 individuals “for their alleged involvement in a network of ‘pill mill’ clinics and pharmacies” that resulted in the diversion of approximately 23 million oxycodone, hydrocodone, and carisoprodol pills. The 41 defendants, who were charged in the Southern and Eastern Districts of Texas and the District of Massachusetts, include medical doctors, nurses, clinic owners and managers, pharmacists, pharmacy owners and managers, and drug dealers and traffickers.

The indictments allege that participating doctors, medical professionals, and pharmacies knew the prescriptions for the opioid medications

had no legitimate medical purpose and were outside the usual course of professional practice. In some cases, “crew leaders” and “runners” allegedly filled or had the individuals who posed as patients fill the illegal prescriptions at Houston-area pharmacies. The owner and pharmacist in charge at one pill mill pharmacy allegedly dispensed the second highest amount of oxycodone 30mg pills of all pharmacies in the entire State of Texas in 2019, and the ninth highest amount in the nation. One hundred percent of the oxycodone dispended by this pharmacy – every single oxycodone pill that left the premises – was in the highest available dosage strength of that drug.

In some instances, drug dealers and traffickers “allegedly diverted and distributed the controlled substances to the streets, with some pills trafficked from Houston to Boston.”

In addition to the indictments, the Department reported that in the Southern District of Texas, “350 law enforcement personnel executed a total of 36 search and seizure warrants in various locations (including 15 pharmacies, six “pill mill” clinics, and other offices and residences” that were aimed at disrupting opioid-diversion networks. It also stated that the Drug Enforcement Administration (DEA) “issued nine immediate suspension orders (ISOs) to support related investigative efforts to interrupt an opioid drug diversion distribution chain.”

Note: In the flurry of global publicity relating to the welter of civil litigation against opioid manufacturers and distributors, and the potential for hundreds of billions of dollars in civil damages and abatement costs, the role of U.S. federal law enforcement in combating the opioid crisis through the criminal process often receives little if any attention. The Department has already shown this year – through its $225 million criminal and civil resolution with pharma company Insys Therapeutics, convictions of multiple Insys executives, and the indictment of pharma company Indivior — show that the Department has the resolve to prosecute opioid manufacturers when appropriate for their roles in fraudulently marketing opioids. The indictments announced this week indicate that the Department is also prepared, as appropriate, to prosecute individuals and firms for their roles in later stages of opioid diversion, and to show the linkages between ostensibly “legitimate” health-care providers and pharmacies and criminal organizations in the diversion process.

(Full disclosure: The Fraud Section of the Department’s Criminal Division is credited with leading this series of enforcement actions, in conjunction with three U.S. Attorney’s Offices, the DEA, and other law enforcement agencies. I was a Deputy Chief in the Fraud Section until 2015, but had no hand in the investigation of any of the cases mentioned here.)

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Published by Jonathan J. Rusch

I'm a lawyer and consultant interested in corporate- and individual-compliance issues, and an inveterate part-time law professor; a former federal prosecutor, regulator, and anti-bribery and corruption compliance head at a global financial institution; and a (very minor) shareholder in Williams Grand Prix Engineering.
View all posts by Jonathan J. Rusch